By Mike Cherney
SYDNEY--Australia's workplace regulator has sued Coles Group Ltd., one of the country's two biggest supermarket operators, for allegedly underpaying more than 7,500 salaried employees a total of 115 million Australian dollars (US$81.7 million).
The Fair Work Ombudsman said most of the underpayments were the result of Coles paying employees annual salaries that were insufficient to cover the work they actually did, given that they put in lots of overtime. The underpayments occurred between January 2017 and March 2020.
"Businesses paying annual salaries cannot take a 'set-and-forget' approach to paying their workers," said Fair Work Ombudsman Sandra Parker. "Employers must ensure wages being paid are sufficient to cover all minimum lawful entitlements for the hours their employees are actually working."
Coles said it is reviewing the proceedings. The company said it has been conducting a review into the pay arrangements for salaried team members and has already paid out A$13 million, with a further A$12 million provisioned in its most recent accounts.
The ombudsman alleged that salaried managers were generally contracted and rostered to work 40 hours per week, but worked one additional hour on average per shift.
Alleged underpayment of workers has been an issue for the broader supermarket industry in Australia. The ombudsman also sued Woolworths Group Ltd., the other big supermarket operator, for a similar matter earlier in the year.
Shortly after that lawsuit was filed in June, Woolworths said it had self-reported the matter to the ombudsman and had been working to review and remediate the issue since 2019. It said at the time that more than A$370 million had been paid to current and former salaried team members.
Write to Mike Cherney at firstname.lastname@example.org
(END) Dow Jones Newswires